Financial and economic crisis in the USA have created a Domino consequence with the planetary economic system and now the recession is expanded to Europe, Asia and other parts. Thailand can non avoid this consequence either. In get bying with the organisations need to set themselves for protection from the altering or unsure state of affairs. The leaders of the organisations or CEOs are required to assist the organisations survival amidst the crisis. In the 20 first century successful leaders will react to the new world or paradigm displacement. Therefore, an interesting thing reference about the leading of successful organisations is whether the organisation is wining with its leading or direction? This article focuses on the new world for leading in the crisis state of affairs. And how leader in the private sectors in Thailand are adjustable the organisation in the uncertainly economic.
We are in the crisis? When sing the 3rd to 4th one-fourth of 2007, the planetary stock markets were dramatically dropping because of the Sub-Prime crisis in the U.S. The job of the Sub-Prime in U.S. initiated from the liquidness loss of fiscal establishments which resulted from the existent estate loan impairment. In the beginning, most of analyst estimated that the wake of the Sub-Prime crisis would non be rather terrible. However because of the U.S. existent estate recession, the Ministry of Finance of the US made the determination to take over two loan establishments, Fannie Mae and Freddie Mac. Those were in the procedure of being desperately strengthened by the Federal National Mortgage Association in order to convey the investors assurance back ( Siam Intelligence Unite, 2007 ) .
The great impact of planetary fiscal crisis was clearly evident in 2008. Get down with the prostration of Lehman Brothers and the forced sale of Merrill Lynch which took form over the weekend of 13-14 September 2008 have confirmed the graduated table and gravitation of the planetary fiscal crisis ( Pettifor, 2008 ) . Coca-Cola Enterprises Inc. reported a loss of 1.1 billion for 2006 and said that it would cut 3,500 occupations as its costs rise ( JobBank USA, 2007 ) . The largest bank of Russia, Sberbank Bank wanted to cut down up to 70,000 occupations before 2013 ( The Economic Times, 2008 ) . Citigroup Inc. announced occupation cuts of up to 50,000 employees worldwide ( Azhar & A ; Lim, 2008 ) . Furthermore, AIG looked like it would go belly-up and they had made the US authorities to back up them by supplying loan 85,000 million dollar. ( Siam Intelligence Unite, 2007 ) . The above illustration events were plenty for US authorities to denote a program for recovery of their economic system by budgeting 3.25 trillion dollar to alleviate the crisis but it seems to hold small consequence to assist them off from the crisis ( Suwanaporn, 2009 ) .
Harmonizing to the mentioned crisis, all organisations need to set themselves for protecting themselves from the altering or uncertainness state of affairs. The leaders of the organisations or CEOs are therefore required to assist the organisations survival amidst the crisis. The effectual leaders should be able to alter the organisation or pull off their organisation in the every state of affairs particularly in the crisis clip. In west Jack Welch of General Electric Company ( GE ) , Bill Gates of Microsoft, and in Thailand Chumpol Na Lamlieng of Siam Cement Group ( SCG ) , and Dhanin Chearavanont of Charoen Pokphand Foods LPC. ( CP ) are the good ideal for leaders. When sing by the features found that these have their ain same and different features, experience every bit good as instruction. But all of them have the same thing, which is the ability to take their organisation to a high effectivity in every environment ( Promsri, 2005 ) .
And now a twenty-four hours, in the quickly altering economic system the necessary accomplishment for leaders is the ability to convey an organisation to get the better of the minute crisis ; but the inquiry is how they can get the better of the quandary.
Propose of the Article
This article focuses on the new world for leading in the crisis state of affairs. Equally good as, how leader in the private sectors in Thailand are seting their organisations in the unsure economic system will be discussed.
Crisis in Thailand
Financial and economic crisis in USA have created a Domino consequence in planetary economic sciences and now the recession is expanded to Europe, Asia and other parts. Thailand can non this consequence either. Between 1997 – 2009, Thailand has faced many crises from economic sciences, natural catastrophe, political uncertainness and diseases. In 1997, we faced the fiscal crisis called Tom Yam Kung Crisis. Then 1998, 56 fiscal institutes were shut down by the ordinance of fund from Bank of Thailand. Three twelvemonth subsequently in 2002, SAR flu spread from foreign states to Thailand. In 2003, Bird flu disease happened. And in 2004, we lost more than 8,000 peoples from a Tsunami harmful ( Thainewyork, 2005 ) . Between 2006 – 2007, Thailand faces uncertainness from political relations: get downing with reformatory authorities by military and after that Thailand had 3 authoritiess within one twelvemonth. Since 2008 until now, Thailand was economically affected by the impact of planetary fiscal crisis. And the Swine grippe ( H1N1 ) disease has spread to Thailand.
Tom Yam Kung Crisis
First clip fiscal crisis in Thailand
Council of National Security – Central nervous system
( Reformative authorities by military. )
Gen. Surayuth Government
1. Samak Government
2. Somchai Government
3. Aphisit Government
( Global Financial Crisis )
( H1N1 )
( H5N1 )
Near 56 Finance Institution
Crisis in Siam: See it to be familiar.
Figure 1. Crisis in Thailand
Beginning: Adopt from Thai HR Forum, 2009
As shown in the figure that more than 10 old ages Thailand has confronted many uncertainness events that affect to our economic sciences, touristry and society, and we can non calculate the hereafter environment that will impact our economic sciences once more. So every organisation should fix itself to cover with the quickly altering and uncertainness environments. Because of the unpredictable hereafter environment will impact our economic sciences, in this state of affairs we need the effectual leader. That is why the leaders are really of import to every organisation to over come the crisis state of affairs or trouble. How leading influence on the organisation? How private sectors in Thailand survive in the last 10 old ages of Thailand crisis?
Leadership has been a subject of involvement since olden times. The scientific surveies in leading began around the terminal of 19 century. Until now we have more than 350 definitions of leading term offered by bookmans and other authors ( Daft, 2005 ) . This article will show some definitions of leading as follows:
The chief dynamic force that motivates and coordinates the organisation in the achievement of its aims ( Bass, 1990 cited in DuBrin, 2006 ) . Daft ; definition of leading is an influence relationship among leaders and followings who intend existent alterations and results that reflect their shared intent ( Daft, 2005 ) . O’Leary says leading means that the ability of converting people to follow up what the 1 wants ( O’Leary, 2000 ) .
Most definitions of leading imply that a leader has consequence on organisation public presentation. Leaderships, action and personal influence bring about alteration. Leaderships are people who have authorization in organisation that is highest degree, executive or top direction. Highest degree executive are importance in organisation. Major organisational jobs are solved by these leaders, In here may be leading alteration the hope that the freshly appointed leader will change by reversal public presentation job ( DuBrin, 2006 ) . For illustration, Mr.Viwat Limsakdakul, Managing Director of TIPCO Foods Group ( TIPCO ) . was appointed pull offing manager of TIPCO in 1998. In that clip major job of TIPCO was accumulative shortage 800 million tical ( Viwat, 2009 ) . So, first undertaking mark was doing shortage concern to go a benefit concern. Within three twelvemonth, he achieved the mark. Viwat addressed that he can work out the job in TIPCO. He started with strong consideration the aims of organisation. He has changed construct of selling and paid attending to client. Viwat said that he found one of doctrine of direction the TIPCO which is “ Buy in to the staffs ‘ bosom ” . His doctrine has run by sharing the end and working together. Viwat ended the conversation with a doctrine he has gained from his past working experiences that “ When you are at a making point to be the phase of decision maker or organisation leading, the thing proved and assent to the leading must be from other people because it means credence from other ( Viwat, 2009 ) . It might be said that the leading of leader is a cardinal success factor to take an organisation to accomplishment.
In drumhead, leading is of import for leader and organisation. Leadership can draw the employee attempts to make the organisation ends. The effectual direction of organisation in the crisis timing is depended on leading behaviour that encourages members to actively prosecute in cognition acquisition and the preparation of schemes to decide the crisis ( Dutton & A ; Jackson, 1987 ; Wooten & A ; James, 2004 cited in Wooten & A ; James, 2008 ) .
The New Reality for Leadership: Paradigm Shift
As mentioned above the leading of leader affects organisational public presentation. In the yesteryear, the leaders think about if they keep the organisation running on a steady class, the organisation should hold accomplishment. Today the economic universe is altering. Globalization, high engineering, high competition in selling, telecommuting and rapid environment alterations are doing cardinal displacements that have impact on organisations and present new challenges for leaders ( Daft, 2005 ) . So that why, leader demand to the New Paradigm.
Daft reference about the new world for leading. “ A paradigm is a shared mentality that represents a cardinal manner of believing about, perceiving, and understanding the universe. ” ( Daft, 2005, p 8 ) . The New Paradigm, is outlined in Table 1
Table 1 The New Reality for Leadership
OLD Paradigm New Paradigm
Stability Change and crisis direction
Egoistic Higher intent
Beginning: Daft, 2005, The Leadership Experience.
As shown in the Table 1, the old paradigm displacements from Stability to Change and crisis direction.
Change and crisis have become the norm for many organisations
( Mitroff, & A ; Anagnos, 2001 ) . Present, the inevitableness of alteration and crisis are accepted by the best leader and they recognize that leading is a possible beginning of energy and self-renewal. They have to develop effectual crisis direction accomplishment that can assist their organisations in the crisis timing and travel the organisations toward something better. The leader had taught by the pervasiveness of environment alteration to actively encompass and make alterations within the organisation which can develop single workers and travel the organisation frontward ( Daft, 2005 ) .
More significantly the old paradigm shifted from Control to Empowerment.
“ No longer can organisation afford to hold workers look into their head at
the door. ” ( Draft L Richard, 2005, P.17 ) . Leaderships were top direction who believed rigorous control is of import for their organisation. “ What to make it? When to make it? How to make it? and Who to make it with? ” That citation grade show everyone know the leader on the top has more power than the underside. But today ‘s leader portions power instead than centralising. He finds ways to increase an organisation ‘s encephalon power by acquiring everyone in organisation involved and committed ( Daft, 2005 ) .
In add-on, the old paradigm shifted from Competition to Collaborate.
“ New ways of working that emphasize coaction over competition
and struggle. ” ( Daft, 2005, P. 11 ) . Although some companies still encourage internal competition but most of organisations are emphasizing teamwork and cooperation. Some competition can be healthy for an organisation, but many leaders are defying the thought of competition as a battle to win while person else loses. A new signifier of planetary concern is made up of web of independent companies that portion fiscal hazards and leading endowment and supply to engineerings and markets ( Friedheim, 1999 ) .
The move to coaction nowadayss greater challenges to leaders than did the old construct of competition. Within organisation, leaders need to make an environment of teamwork and community that Fosters coaction and common support. The call for authorization, combined with an apprehension of organisations as portion of a fluid, dynamic, interacting system, makes the usage of bullying and use obsolete as a agency of driving the competitory spirit ( Daft, 2005 ) .
In add-on, the old paradigm displacements from Uniformity to Diversity
Draft confirms that the organisations were built on premises of uniformity, separation, and specialisation. Peoples who think likewise, act likewise, and have similar occupation accomplishments are grouped in to a section, such as accounting or fabrication, separate from other sections. Homogeneous groups find it easy to acquire along, communicate, and understand one another. Still conveying diverseness into the organisation is the manner to pull the best human endowment and to develop an organisation mentality wide plenty to boom in a transnational universe ( Daft, 2005 ) .
More over the old paradigm displacements from Self-Centered to Higher Purpose
The ethical convulsion of the early 21st century has prompted a determined and witting displacement in leader mentality from a egoistic focal point to emphasis on a higher intent. Public assurance in concern leaders in peculiar is at all-time low, but political relations, athletics, and non-profit-making organisations have besides been affected. In the new paradigm, leader emphasize answerability, unity, and duty to something larger than single ego involvement, including employees, clients, the organisation and all stakeholders ( Sellers, 2002 ) . The new paradigm respects that honestness, unity, and answerability to stakeholder are importance for leaders.
The old paradigm displacements from Hero to Humble.
In this term, low are their personal humbleness. For the organisation the leaders still are extremely ambitious. Leaderships change from the “ leader as hero ” to the difficult working behind the scenes. Humble leaders build a sustainable company by back uping and developing others instead than seeking to rule them ( Collins J. , cited in Daft, 2005 ) .
In the past leader frequently build an organisation around a hero and troop of assistant. New paradigm leaders build an organisation with many strong leaders. Many strong leaders will develop their organisation continuously and achieve sustainability in the long tally. ( Draft, 2005 )
How leaders in private sectors in Thailand adjust their organisation in the economic uncertainness?
In Thailand we are in a state of affairs of uncertainness more than 12 old ages until now. How can Thailand survive until now? Is leading truly related to organisation accomplishment? Is the organisation successful by leading non by direction? We have 1000s of inquiries about what the existent factor conveying the organisation to get the better of the crisis. From these inquiries, in HR position, the writer understands one word from Professor Dr. Gary McLean said “ It depends ” .
“ McLean ‘s Philosophical attack to HRD is to look for multiple instead than individual replies to a inquiry. ” ( McLean 2000 cited in Chiraprapha, 2002, ) .
When the organisation is in the crisis, there are many ways to work out jobs. It has non a individual reply or individual manner to work out jobs because it depends on state of affairs that organisation confronts. If it depends on state of affairs, why this article still focuses on leading. Because top direction or CEO is last people who make determinations to make something.
In a crisis state of affairs, we need corporate and dynamic leading, and leaders require perceptual experience and sense devising accomplishments in order for them to find appropriate classs of action. The crisis leading competences are expected to be included in activities such as determination devising, communicating, making organisation capablenesss, and developing human capital ( Wooten & A ; James, 2008 ) . Therefore, it is really interesting about the successful organisations with leading is whether the organisation wining because of leading or direction?
It is of import to hold on the difference between leading and direction. Management emphasizes on planning, forming, directing and commanding. Leadership trades with interpersonal facets of a director ‘s occupation, alteration, inspiration, motive, and influence ( Dubrin, 2006 ) .
For clear apprehension, Daft compared between direction and leading in five important countries as shown in figure 1.
Figure 2. Comparing Management and Leadership
Beginning: Kotter, 1990 cited in Daft, 2005
From figure 2. Daft summarizes the difference between direction and leading from John P. Kotter, Joseph C. Rost and Dumaine in five countries:
( 1 ) Supplying Direction:
In footings of way, direction focal points on programs and agendas for accomplishing, so apportioning resources to carry through the program. Leadership emphasize for making a vision of future and developing schemes. Management keeps eyes on the bottom line. Leadership calls for maintaining an oculus on the skyline.
( 2 ) Aligning Followings:
Daft argues that Management focuses on organisation construction to accomplish the program, developing policies, and monitor execution of the program. Leadership is concerned with communicating the vision and underdeveloped civilization.
( 3 ) Constructing Relationships:
Management focuses on objects such as studies and machines. In the other manus leading focuses on inspiring and actuating employee.
( 4 ) Developing Personal Leadership Qualities:
Management focuses on encourages emotion distance in the other manus leading means being emotionally connected to other. Leadership is more than set of accomplishments. These include unity, bravery, enthusiasm and humbleness. “ Great leading is people who love what they do and desire to portion that love with others. ” ( Daft, 2005, p 20 ) .
( 5 ) Making Result:
The differences between leading and Management create differing result. Leadership creates alteration within civilization of unity that builds honestness, positive relationship. In the other manus direction maintain about stableness, predictability, and order through a civilization of efficiency ( Daft, 2005 ) .
In Short, direction concerns seting organisation ends into effectivity through planning, directing, staffing and commanding organisation resource. Leadership attack focuses on alteration, authorization and relationship. Many directors already have abilities and quality needed to be effectual leaders. Leadership can non replace direction it should be an add-on to direction.
Another of import inquiry is leading affect upon accomplishment of organisation interrupting through the fiscal crisis? This inquiry will be considered in the following subdivision.
The Best pattern in Thailand, from Sombat Kusumawalee ‘s research which used Siam Cement Group ( SCG ) as a instance, the survey found that SCG is successful because SCG is harmonious with four features of good organisation which are ( 1 ) Principle-base organisation ( 2 ) Productive organisation ( 3 ) Adaptive organisation and ( 4 ) Populating organisation. SCG has applied four rule which is “ SCG codification of moralss ” , dwelling of four ideals ( Adherence to Fairness, Dedication to Excellence, Belief in the Value of the Individual and Concern for Social Responsibility ) and Corporate Governance.
The importantly reference of rules is non lip service. See this survey, it is found that every degree of SCG forces take this regulation until it becomes a tradition or organisational civilization
Harmonizing to a research, it was found that one of the successful factors of SCG was the executives ‘ function theoretical account of leading that follows the set up rules. SCG board executives along with appointees largely have their ain private and working behaviour in line with the moralss of SCG, demoing a outstanding characteristic which is low profile/high productiveness: easy life style, working hard, non truly holding a societal function, honestness, professional, and high subjects. This sort of executive ‘s features becomes a theoretical account for other staff to follow ( Kusumawalee, 2006 ) .
The important key in constructing an efficiency and proficiency for the company concern procedure and taking the company to the achievement with sustainable domestic every bit good as international fight is the personnel disposal of SCG.
SCG has its ain construct which is “ Employees are of import and valuable resources ” . Therefore, the concern disposal of SCG focuses upon developing employees ‘ possible including physical, mental, and rational competence in order to let them to hold equal cognition and better themselves along with utilizing their ain potency to take the SCG to the best sustainable concern. The SCG has devoted such a pile of resources while at the same time developing cognition, scruples, and outlook towards the employees ( Peetawan, 2009 ) .
In respect to offering particular course of study to back up and promote working lifestyle, viz. Functional preparation, Business Management and Leadership, Oversea Expansion and Valued Innovation, those above are assumed that they are Business Management and Leadership Development Curriculum.
Figure 3. SCG Training & A ; Development Program
Beginning: Peetawan, S. ( 2009 ) . Knowledge Sharing: Company visit by TLCA
When sing the route map of efficiency development and forces ‘s possible encouragement, besides stressing upon employees ‘ cognition and competence betterment of SCG harmonizing to Core Competency needed in concern, SCG still pays parallel attending to leading, for illustration, any employees who work for 1-2 old ages will be offered a survey of entrepreneurship in the course of study of Abridged Business Concept Development ( ABC ) . They will be able to larn about cognizing yourself and they will be able to work with others efficaciously. For leading Development Program Curriculum: Leading Yourself ( LDP1 ) , the employees, who work for upper 6 old ages, will be able to larn about Business Concept Development ( BCD ) in deepness and how to be a adept leader through Leadership Development Program Curriculum: Leading Team ( LDP2 ) . Those in pull offing degree, who work for over 10 old ages, will be offered an intensive course of study of Management Development Program ( MDP ) by academically collaborating with Wharton Business School, University of Pennsylvania. The course of study contents consist of Information Resource Management, Leadership and Change, Financial Management and Control, Operational Excellence and Innovation & A ; Entrepreneurship, Strategic Marketing Management and Strategic Management. There is besides a particular course of study in Leadership Development viz. , Leadership Development 3: Facilitative Leadership ( LDP3 ) . Those in medium pull offing degree will be offered the Executive Development ( EDP ) by the cooperation of Columbia University in order to better leading, working through people, entrepreneurship, implement alteration, and planetary mentality. Advanced Management Program ( AMP ) at Harvard Business School and Wharton Business School stands for senior executives. The course of study contexts consist of Accounting and Financial Management, Managing Organizational Effectiveness, Marketing Leadership, Business Government & A ; International Economy and Competitive & A ; Corporate Strategy. It is expressed that even though SCG specially gives importance to Business Knowledge, it still does the same thing with leading accomplishment get downing from new employees to CEO degree. Those show about organisational development which non merely focuses on human development as precedence, but besides leading accomplishment should non be ignored. Kan Trakulhoon, President and CEO of SCG, feels confident that holding a good leader in any organisations enables to bring forth plentifulness of other leaders widespread. In contrast, holding a bad leader can precisely do devastation of employees ; thereby, leading course of study survey contributes to broadening positions which are easy integrated ( Thannews, 2007 ) .
Discussion and Recommendations
In the position of the writer, leading accomplishment is indispensable for organisations. How about the recent fiscal crisis? How can leading help the organisations to crush the quandary while they are undergoing the economic crisis? Administration policies to last the organisations depend upon the leaders ‘ determination that is finally important on either organisational development or recession. While the organisations are undergoing with the fiscal crisis, job declaration are relies upon the CEO. How can those survive among the quandary? Besides, the determination made by the CEO in many policies has an influence upon all degree of employees such as Lay Off, down Size, Over Time, one-year fillip, every bit good as salary lessening. Those are the policies of many organisations to worsen their capital. However, employees ‘ moral support is attacked and it can be such a large trade for the endeavors. Ethical guideline should be issued in doing determination during the period of economic crisis.
In the context of Thailand, whenever the organisations are attacked by the fiscal crisis, big Thai corporations including SCG, Denzo International ( Thailand ) Ltd. , Western Digital and other top enterprisers try to maintain a keeping every bit good as they could instead than utilize unemployment policy. ( Personnel Management Association of Thailand, 2009 ) What ‘s of import is direct communicating between the executives and employees to name for empathy while the organisations are at hazard. Thavorn Charassathein Executive commission of Denzo International ( Thailand ) Ltd. , stated that communicating for doing all degree in the endeavors understand about the cause of the economic recession is such a good manner. It should besides be normally talked about how to diminish expenditure the most by non carry oning the unemployment policy to wholly spread out the anguish towards the companies non simply for employees but besides employers to experience empathic. The executives should be such a dominant illustration such as salary lessening, fillip lessening, flight category alteration, and employees ‘ diversion plan lessening. It is clear that moralss of leading have played an of import function in many big organisations towards policies during the period of economic slack. The executives and employees should collaborate in interrupting through the crisis more than using the unemployment every bit precedence as they did before ( Charatthein, 2009 ) .
Using the Sufficiency Economy Philosophy is another important factor that many top endeavors frequently put into action and follow up. The doctrine is possessed by His Majesty the King of Thailand which is a manner for employees to earnestly carry on based on cognition and morality ( Charatthein, 2009 ) . With respect to the doctrine, it is apparent that whenever the organisations are down, the leaders are so of import to expose such an illustration function for employees and seek to pass on with them so as to good understand the existent state of affairs before carry oning the unemployment policy. In the writer ‘s point of position, this would ensue from being under the crisis of Thailand, as already old explained. The organisations so seek to retain as many employees as they could so that when the economic system becomes bit by bit better in the hereafter and those endeavors will be ready to run the procedure instantly. On the evidences of being under the quandary for such a long clip, it changes leading and paradigms of the executives besides. The economic crisis has an consequence upon everyone, doing the alteration of leading moralss by stressing on the importance of human values instead than taking the period of the crisis to diminish unemployment or establishing such any policies for the endeavors ‘ benefits without concern about other coworkers who are sing the same trouble.
More than 10 old ages ago Thailand has confronted many uncertainness events that affect upon our economic system and our society. Because of the unpredictable consequence of future environment to economic system, the leaders are really of import for every organisation to get the better of the quickly changed state of affairs. Nowadays, successful leaders will react to new world or paradigm displacement. The displacement discussed in the old subdivision, informs that leaders shift from a rational direction attack is concerned about stableness and control to leading attack which is valued to empowerment and relationship.
The new paradigm requires directors to go such successful leaders. Management and leading should be a combination of leading qualities and rational direction accomplishments.
Leadership is easy to be learning and understand ; nevertheless, it is rather hard to implement and non every corporation can be successful, harmonizing to the writer position point. The executives should be open-minded and good axial rotation theoretical account towards employees. Some realize that they are excessively rigorous ; while, others realize that they know themselves good and they do non desire to alter anything. In current circumstance, where the universe is quickly changed and it globally encounters with the fiscal crisis ; a new leaders ‘ function should be adapted. It is needed to be shift paradigm so as to convey our organisations in interrupting through the fiscal and economic trouble. Nevertheless, moralss for leading is a thing that helps us in direction, disposal, effectual communicating, and honesty towards each other. Those can do balance between the employers and employees. Even though they are enduring from this terrible fiscal job, they are ready to successfully interrupt through the crisis for our organisation.